A look at how teams structure their payroll and the merits of the different strategies.

The general manager and owner’s dilemma been around since Ban Johnson decided that it was better to pay players rather than having them play as amateurs, the dilemma of trying to balance a budget with creating the most competitive team possible. We armchair GMs like to talk about whether this deal or that deal is good or bad, often within the framework of how much a player is being paid and whether they are “worth it.” Indeed, Baseball Prospectus strives daily to provide data that works to define that conversation.

The general manager’s dilemma, however, is tougher than, say, the budget that you or I set for our household. With some exceptions, most of us have a general sense of what our income and expenses will be. We may get a modest raise and the cost of living may increase at a rate that we can see coming, so for the most part, our monthly budgets can be set and we can adjust accordingly.

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A look at how the Nationals are trying to get more out of their television deal

To get to the heart of this messy matter, one needs to start at the beginning. The creation of Mid-Atlantic Sports Network (MASN) was the direct effect of negotiations between MLB and Orioles owner Peter Angelos to allow the relocation of the Montreal Expos to the Washington, D.C. market. Angelos was vehemently opposed to the move, saying that while the location proposed in the Nation’s capital would not infringe on baseball’s physical territory outlined in the MLB Constitution (see page 15), it would carve a hole in the Orioles’ television territory and take a massive dent out of TV revenues. The compromise was the creation of MASN. The Orioles initially controlled 90 percent equity in the regional sports network, while over a 23-year period the Nationals’ equity would grow to just 33 percent. Currently, the Nationals have a 13 percent equity stake. In terms of that being an equitable arrangement, the question becomes, “Do you give that much control of MASN to the Orioles or not allow the Expos to relocate to Washington, D.C.?” The answer was more or less, “We’ll choke on the equity stake, just let us (the Expos) into Washington, D.C. and let us become the Nationals.”

Into this mix has been the skyrocketing increase in television rights fees that began with the Texas Rangers’ $3 billion, 20-year deal that was mirrored by the Angels and has since set the market. The Padres—who, based on Nielsen, are the 28th largest Designated Market Area (1,077,600 television homes)—are on the verge of completing a deal with FOX Sports San Diego in which the club will receive a 20-year television deal that could top out at as much as $1.2 billion and has $200 million in up-front equity. Such a rights deal would pull in $50 million annually.

A look at the Padres' impending sale and how television rights deals are changing the way clubs are valued.

It would be disingenuous to say owners in MLB are doing “nothing” and getting rich. But, by default, they are. Whether it’s indirectly or through media rights deals, from the top to the bottom, each ownership is going to eventually land on a pile of greenbacks.

Case in point: the San Diego Padres. Current owner John Moores has been trying to unload the club for years now, a nasty side-effect of community property laws in California and a divorce from his wife. When the deal with Jeff Moorad fell through, it actually worked to Moores’ advantage.

This is Part Three of a multi-part series on MLB’s latest labor agreement. Part One addressed changes that impact the first-year draft. Part Two focused on the luxury tax and the minimum salary.

In the first installment of this series, I noted how it took 183 days from the time that the MLBPA and MLB reached a memorandum of understanding (MOU) on a new labor agreement until the document was released to the public. It was a long time, which speaks to the complexities involved in the union/management relationship in sports. And while the CBA was released on May 23rd of this year, the associated drug agreement was not.

In Part One of this series on MLB’s new Collective Bargaining Agreement, the focus was on the changes to the draft system. Today, we look at changes to minimum salaries and the soft-cap via a luxury tax on total player payroll.

Each time a new labor agreement is reached in professional sports, there is invariably the question of, “Who came out on top?” You might be able to say the needle swung slightly one way or the other, but in the end the only real winner is “compromise.”

This is Part 1 of a multi-part series on the latest Collective Bargaining Agreement

On November 22 of last year, Major League Baseball and the MLBPA did something that the NFL and the NBA could not: reached a new labor agreement without a work stoppage. For those that follow baseball’s labor history, it has become a miraculous run. By the time the current five-year Basic Agreement (read here) expires on December 1, 2016, it will have been 21 years of uninterrupted labor peace.

It’s not exactly the beginning of the season, but we’re not yet approaching the All-Star break either. It’s that time of year when the league and its clubs are beginning to settle in on the business of matters. There are times when one topic per week simply won’t do, and this is one of those times. Here are capsules on a number of things going on in baseball outside the lines.

The Latest CBA Will Be Going Public… Really
While the NFL and NBA went into lockouts last year, MLB and the MLB Players Association announced that a new labor agreement had been reached on November 22, three weeks before the 2006-2011 Basic Agreement was set to expire. While general details for the 2012-2016 agreement were released at the time, it’s been nearly five months now and it has yet to be released in its entirety.

A look at ever-increasing player salaries and the player best-positioned to eclipse the $300 million mark

"Professional baseball is on the wane. Salaries must come down or the interest of the public must be increased in some way. If one or the other does not happen, bankruptcy stares every team in the face." – Albert Spalding, 1881

How long have we been hearing that baseball players are paid too much? By my count, it’s been since it was decided that they should be paid. Babe Ruth was the first to hit the $50,000 mark in 1922, and Hank Greenburg hit the $100,000 mark 25 years later.

It took a day longer than expected, but shortly after 10 AM PT on May 1, the sale of the Los Angeles Dodgers from Frank McCourt to Guggenheim Baseball Management LLC (“GBM”) for $2 billion took place. The Dodgers’ new ownership includes Mark Walter as control person, Earvin “Magic” Johnson, and Stan Kasten as CEO of the organization.

The Los Angeles Dodgers stated, “The Dodgers emerge from the Chapter 11 reorganization process having achieved its objective of maximizing the value of the Dodgers through a successful Plan of Reorganization, under which all claims will be paid. The Dodgers move forward with confidence - in a strong financial position; as a premier Major League Baseball franchise; and as an integral part of and representative of the Los Angeles community.”

Examining attendance trends throughout Major League Baseball in the early going of 2012

You’re reading Baseball Prospectus, and I write for them. So, maybe not everyone will understand when I say that numbers are flat. They don’t tell the whole story. They can only get you close. What you have to have with numbers is “context.” I don’t care what the application of numbers is; if you don’t explain them, you’re only telling part of a story and, possibly, the wrong one.

Major League Baseball attendance is no different. The variables underneath what drives attendance figures are often overlooked. Each year I look at the numbers, and each year there seems to be something else to throw in to try and determine the underlying facets of them.

Before Howard Lincoln, Chuck Armstrong, and fans from the Pacific Northwest begin calling, the Seattle Mariners are not for sale. I’m not saying they are. I haven’t even heard a mere rumor to indicate as much. So if the Mariners do issue some kind of statement saying they are “unequivocally, absolutely not on the market” and that “Maury Brown is engaging in the worst kind of journalism,” everyone can point to the 90 words in the first paragraph of this article where I made sure to say they aren’t.

If you were to profile a club that was a prime candidate to be sold, however, the Mariners would be right there at the top of the list, very much looking the part of a club for sale. They are perfectly positioned. They have owners that seem to be in need of selling. And they’re sitting within a near-perfect atmosphere to be unloaded in the wake of the Dodgers sale. The Mariners may not be on the market at this time, but you’d be hard pressed to find a team more suited for it.

A look at the teams that have begun uncharacteristic spending and why this could be a trend we continue to see

I’m not saying this in a Chicken Little way. I’m saying it as a reality that some fans may not fully be grasping: MLB is hitting the mother lode, and that’s translating into player contracts that see greater average annual values (AAV), lengths, and total dollar amounts.

Case in point: USA Today recently released their annual Opening Day salary numbers, and the league will see a 5.55 percent increase in total dollars allocated to 25-man rosters from last year—a jump from $2,786,163,302 on Opening Day in 2011 to $2,940,659,204 this year. This represents the largest year-to-year increase since 2007.